When asked why bond prices remain surprisingly high, O'Neill refers to the monetary policy of the Fed, the Bank of Japan and the Bank of England.

He believes that the price of oil peaked two years ago and the price of gold has been very speculative. The recent commodity sell-off therefore does not surprise him.

Driving the commodity weakness is that the growth in China which a couple of years ago was 10% per year is now settling into a more stable growth rate of 7%. That is impacting the commodity bull market.

He also suspects that the Japanese policy moves are going to make a big difference and he is quite bullish on Japan and Japanese equities.

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